In der Debatte um die Schuldenbremse bildet sich zunehmend ein Konsens für eine Reform heraus. Zuletzt versuchten Feld et al. (2024) den häufig vorgetragenen Kritikpunkt zu entkräfteten, die Schuldenbremse behindere staatliche Investitionen. Die verwendete synthetische Kontrollmethode...

Announcing a large fiscal stimulus may signal the government’s pessimism about the severity of a recession to the private sector, impairing the stabilizing effects of the policy. Using a theoretical model, we show that these signaling effects occur when the stimulus exceeds expectations and...

This paper presents a stock-flow-consistent model in which growth is led by exports and government expenditure. It considers domestic and external debt dynamics and gross capital flows. Countries may choose to not fully use their external space to accumulate international reserves. The model is...

Over the last decades, the United States has experienced a large increase in, both, income inequality and living standards. The workhorse models of optimal income taxation call for more redistribution as inequality rises. By contrast, living standards play no role for taxes and transfers in...

When taxes do not sufficiently adjust to government debt levels, the Fiscal Theory of the Price Level predicts that other variables, such as inflation and output gap, must adjust to ensure the solvency of public finances. We study the role of optimal debt maturity portfolios in this context,...

This paper documents the extension of MEDSEA, a small open economy DSGE model for Malta, with a detailed energy sector. The model contains relatively rich fiscal and energy blocks allowing the model to simulate the transitional costs related to the economy's decarbonisation, together with the...

The objective of this work is to analyze the impact of fiscal decentralization on the behavior of Brazilian municipal policymakers. This work uses the first three cutoffs of the transfer rules of the Municipal Participation Fund (FPM) and applies a regression discontinuity designs (RDD) to...

This paper considers the role of fiscal policy in New Zealand's macroeconomic stabilisation. New Zealand's macroeconomic framework is characterised by an institutional arrangement whereby monetary policy has the primary responsibility for macroeconomic stabilisation. In contrast, fiscal policy...

We investigate the causal effect of government spending on real output conditional on economic freedom. Using data for 161 countries from 2000 to 2019 results show, first, that the size of the fiscal multiplier is inversely related to the level of freedom and, second, countries with the mean...

The unfunded social security has long been criticized for reducing capital stock and social welfare. In this paper, we study the aggregate and welfare effects of reforms that make social security tax (SST) age dependent. We characterize the optimal age-dependent SST schedule that maximizes...